Daily Forex Update: NZD/USD

By: Dima Chernovolov

NZD/USD continues to fall inside the clear Down Channel chart pattern which was previously identified by Autochartist on the 15-minute charts. Autochartist rates the quality of this Down Channel at the 6-bar level – which is the result of the slow Initial Trend (one bar), strong Uniformity (7 bars) and near-maximum Clarity (9 bars). NZD/USD is expected to fall further inside this Down Channel – in line with the earlier breakout of the support area shown below.

As can be seen from the daily NZD/USD chart below, the price earlier broke the support area lying at the intersection of the strong support level 0.7050 (which reversed the price at the start of October) and the support trendline of the daily Falling Wedge from July. This price area is acting as resistance zone after it was broken. The proximity of this resistance zone increases the probability NZD/USD will continue to fall inside this Down Channel.

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